TOPIC

RIGHTS AND INTERESTS

TO PROPERTY
Sources of rights and interests in property
Features of rights and interests:
Constitutional
Statutory
Common law
Equitable
Customary
Unenforceable rights and interests
Unchallengeable rights and interests
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To p i c o v e r v i e w
There are many quite significant differences between the legal rules
relating to personal and real property, which is why personal property
will be dealt with in this course, separately from real property which will
be dealt with in LW301 Property Law II, and customary land which will
be dealt with in LW307 Pacific Land Tenure.
But there are, however, some important basic similarities relating to the rights to
property, both personal and real, which we will consider in this Topic, before we
continue to examine the rules relating specifically to personal and real property.
.

To p i c o u t l i n e
1. Sources of rights and interests in property
Constitution
Legislation
Subsidiary legislation
Common law
Equity
Custom

2. Features of rights and interests in property

Constitutional rights and interests
Statutory rights and interests
Common law rights and interests
Equity interests
Customary rights and interests.
3. Unenforceable rights and interests.
4. Unchallengeable rights and interests

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Learning outcomes
After you have successfully completed this topic you should be able to:
 List and discuss the various kinds of rights to property
 Determine and classify the legal sources of rights and interests in
property
 Critically analyse the concept of absolute or determinable/conditional
rights to property

Checklist of activities
To complete this topic you must:
1. Complete the in-book and online activities;
2. Read these course notes; and
3. Complete the set readings.

Readings
Reading 2.1: Chapters 1, 2, South Pacific Property Law, Farran and
Paterson, 2004, Cavendish, London
Reading 2.2: Chapter 1, Principles of Property Law, Hepburn, 2nd ed,
2000, Cavendish Publishing, London
Reading 2.3: Chapter 1, Personal Property Law, Bridge, 3rd ed, 2002,
Clarendon Law Series, London
Reading 2.4: 38 Am Jur 2d, Gifts, paras 80–85

Study time
You should spend approximately 6–8 hours working through this topic.
Remember to undertake all the activities and to think about the questions
posed.

Studying course notes 150 min

Studying Reading 1 60 min
Studying Reading 2 60 min
Studying Reading 3 60 min
Studying Reading 4 60 min
Completing Review questions 30 min
Total (Approximate) 420 min

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1. Legal sources of rights and interests in

property
Rights to both personal and real property are derived from the same legal sources:
a. Constitution: Although constitutions are normally focussed on the
institutions of government, the constitutions of some countries eg Samoa,
Tonga, and Vanuatu, contain provisions that confer rights to land. Since the
Constitution is the supreme law, the rights conferred by the Constitution are
supreme over all other rights.
b. Legislation and subordinate legislation: Although rights and interests in
property were originally the product of the common law and equity,
legislation of many countries nowadays provides rights and interest in
property. Thus, as regards real property, in Solomon Islands the rights and
interests in perpetual and fixed term estates of land, and in Tonga the rights
and interests in inheritable estates of land and commoners' allotments of
land are entirely derived from legislation. In Fiji, Solomon Islands and
Vanuatu, the rights and interests in leasehold land are also very
largely derived from legislation. As regards personal property, in most
countries of the USP region, the sale of personal property is almost entirely
governed by legislation, and rights to intellectual property are also created by
legislation.
c. Common law: Most of the rights and interests relating to real and personal
property were evolved by the common law of England, which has been
introduced into all the countries of the USP region, and so these common law
rights and interests are recognised in countries of the region, except to the
extent that they have been over-ridden by equity, legislation or subsidiary
legislation. These will be dealt with in more detail later.
d. Equity: The courts of equity held that certain rights and interests in
property should be recognised in favour of persons who were the beneficiaries
of trusts or of fiduciary relationships, and, since equity overrode the common
law, these rights and interests would be enforced by the courts regardless of
the common law, except where the property had been acquired by a bona fide
purchaser for value and without knowledge of the equitable rights and
interests. However, where property which is subject to equitable rights and
interests is acquired by a person who does not pay for it, ie receives it as a
gift, or is acquired by a person who is aware of the equitable rights and
interests, those equitable rights and interest will continue and are binding on
the new owner of the property.
e. Customary law: Custom provides rules that are authorised by legislation to
regulate the ownership of customary land in all countries of the USP region.
In some countries of the USP region, ie Kiribati, Nauru and Tuvalu,
customary law is recognized by legislation as applicable to certain matters
specified by the legislation, other than ownership of customary land. In other
countries of the USP region, ie Samoa, Solomon Islands and Vanuatu,
customary law is recognized in general terms as part of the legal system, but
the matters to which it is to apply are not specified. .. In Cook Islands, Niue
and Fiji, customary rights and interests in land are confirmed by legislation,

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but the legal system does not appear to provide for customary rights and
interests to operate with regard to other matters.

2. Features of different kinds of rights and

interests in property
We have seen the different legal sources of rights and interests in property that exist
in the USP region. Now we will consider the principal features of these different
rights and interests.

2.1 Constitutional rights and interests in

property
Constitutions are the supreme law in all countries of the USP region so should be
considered first. Most of the provisions of constitutions are focussed on the
institutions of government, ie the legislature, the executive, the public
administration, and the judiciary.
But the constitutions of some countries eg Samoa, Tonga, and Vanuatu, contain
provisions that confer rights to land. In all three countries however the provisions are
quite different. The Constitution of Samoa states in article 101 “(1) All land in Samoa
is customary land, freehold land or public land. (2) Customary land means land held
from Samoa in accordance with Samoan custom and usage and with the law relating
to Samoan custom and usage. (3) Freehold land means land held from Samoa for an
estate in fee simple. (4) Public land means land vested in Samoa being land that is
free from customary title and from any estate in fee simple.” On the other hand, the
Constitution of Tonga provides in clause 104: “All the land is the property of the
King and he may at his pleasure grant to the nobles and titular chiefs or matabules
one or more estates to become their hereditary estates.” Different again is the
Constitution of Vanuatu which states in article 73: “All land in the Republic of
Vanuatu belongs to the indigenous custom owners and their descendants.”, and in
article 80: “Notwithstanding Articles 73 and 74 the Government may own any land
acquired by it in the public interest.”
Since the Constitution is the supreme law, the rights conferred by the Constitution are
supreme over all other rights The provisions of the Constitution of Samoa made very
little change in fact to the existing pattern of land holding in Samoa, because since
German times, there had been three categories of land in Samoa: customary land;
Crown land, which was essentially public land; and European land which was
freehold land. On the other hand, the provisions in the Constitutions of Tonga and
Vanuatu with regard to land were revolutionary, and created very great changes. In
Tonga, all the land which had previously been owned by the chiefs was now owned
by the King; and in Vanuatu, all the land which had previously been sold or given to
foreigners was placed back in the hands of the custom owners.
Despite their importance to the social and economic systems of these three countries,
the provisions of the Constitutions of Samoa, Tonga and Vanuatu relating to land are
expressed in very broad and general terms and have adopted concepts that were
already developed by the common law of England which had been introduced into
the legal systems of those countries and were well understood. As a result they have
given rise to very few difficulties of interpretation or judicial decisions. We do not
therefore need to consider them further in this Course

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As regards personal property, the Constitutions of all the countries of the USP region
say almost nothing, and so again do not require consideration in this Course.

2.2 Statutory rights and interests in property

Legislation and subsidiary legislation may provide rights and interests in property.
Two of the most striking examples of rights and interests in property created by
legislation are the rights and interests in hereditary estates and in commoners’
allotments which are created by the Land Act of Tonga, and the rights and interests in
perpetual estates and fixed term estates which are created by the Land and Titles Act
of Solomon Islands.
These legislations provide the way in which people may acquire rights and interests
in these different estates and allotments, and what are the rights and interests and
obligations of holders of these estates and allotments. They are very important for the
land law of those two countries, and will be discussed more fully in LW301 Property
Law II., which relates to non-customary land law.

2.3 Common law rights and interests in property

Most of the fundamental principles of law relating to personal property and to
freehold estates in land are derived from the common law of England which was, as
regards personal property, much influenced by Roman and European law. These
English common law principles form the basis of American common law, and have
been introduced into the legal systems of all the countries of the USP region. They
are therefore very important for an understanding of property law in countries of the
USP region.
The main features of common law rules, or as they often called, legal rules, with
regard to property, both real and personal, are summarized in the following sections.

2.3.1 Rights and interests in property

The rules of English and American common law recognized the following main
categories of rights and interests in property
2.3.1.1 Ownership This is the word in the English language which is used to
describe the fullest range of powers and rights to property that the law allows. Rights
of ownership apply both to personal property and to real property.
Ownership is sometimes equated with the Latin word dominium, which under Roman
law was stated to comprise jus utendi, jus abutendi, jus dispondendi, i.e the right to
use, to abuse and to dispose of property. The right of ownership is unlimited in time,
and extends for as long as the property exists. In other words, the rights of owners of
property, under common law, are considered to comprise the right to do whatever the
owners wish with their property for as long as they wish.
Although there has been no direct reduction in the common law concept of
ownership, and the rights of owners of both personal and real property to do what
they wish with their property—to use it, abuse it and dispose of it, as they wish—
there have been other rules of common law which have developed, especially the
common law rules relating to nuisance and negligence, that have imposed liability to
pay damages for injury, damage or loss caused by the exercise of rights of ownership
in a manner that is negligent or a nuisance. These common law rules imposing
liability to pay damages for negligence and nuisance and other forms of

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tortious conduct have served as a limitation in fact upon the exercise of the legal right
of the owners of property to do what they wish with their property.
Also in many countries of the USP region legislation has been enacted by the
legislatures relating to physical planning and environmental conservation, which have
placed significant legal limits upon the rights and powers of owners of real property
to use that property as they please. These will be considered in more detail in LW301
Property Law II.
That is why today in a legal context it is usual to describe ownership as the fullest
rights and powers over property that the law allows.
It is also important to remember that an owner may transfer to someone else some or
all of the rights of ownership, especially the right of possession, and may also by
contract agree not to exercise some of the rights of ownership. As a result, owners of
real and personal property may, by their own actions, voluntarily deprive themselves
of some of the rights to use, abuse and dispose of their property as they please. They
may also by contract purport to bind or benefit their successors, and that raises
difficult questions as to what extent contractual arrangements made by one person
with regard to land can bind successors in title to that person - issues which will be
more fully discussed inLW301 Property Law II.
2.3.1.2 Possession This is the word which is used in the English language to
describe the right to physical control of property. Both personal and real property can
be subject to rights of possession, so that persons can be entitled to exercise
possession over both personal and real property
Exclusive or joint possession Possession may be exclusive, that is a right to exclude
any other person from control, or it may be joint or shared, so it is a right of control
which is shared with others.
Actual or constructive possession Possession may be actual or physical, that is
actual occupation of land or holding an object, or it may be constructive or nominal,
that is exercising control, without actual physical presence, as the receiving of rent
for land which is occupied by someone else, or a hire fee for a car which is driven by
someone else.
The right to possession of property is part of the rights of ownership, and so a person
who is not the owner of property can, under the common law, have a right to the
possession of property only as a result of a grant of the right to possession from the
owner of the property.
2.3.1.3 More limited interests in property The common law recognises other rights
to property which are more limited and less substantial than rights of ownership and
possession, and are in effect rights to limited use of property.. Because these rights
are much less substantial than rights of ownership and rights of possession, these
rights are usually called interests, rather than rights.
The principal such interests are called easements, which are the right to do something
on land owned by another person, such as walk or drive a vehicle across it, or prevent
another person from doing something on his land, such as blocking drains that cross
his land; profits a prendre, which are the right to enter the land owned by another
person and take some natural product from that land, such as grass, or turf or salt, or
water; and licences which are permissions given by the owner of land to other people
to come on to his or her land.

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These are rights which are normally created by grant from the person entitled to
ownership of the property, and so are subject to such conditions as the grantor
imposes, although easements can arise as a result of lengthy exercise without
challenge, ie by prescription.
These interests have been developed mainly in relation to land, rather than personal
property, and it is only licences, or permissions, that have been applied also to
personal property.

2.3.2 Common law rights and interests can be asserted against all
other people
One of the very important features about common law rights and interests to property
is that they can be asserted against all other people, against the whole world, as it is
sometimes said. Below are some examples of the enforceability of legal rights to
property, both personal and real property, against all others:
 McEntire v Crossley[1895] AC 457—legal owners of a gas engine who hired it to
another person, and allowed him to use it on his land for as long as he paid the
agreed hire charges were held able to recover it when charges were not paid.
 Singh v Ali [1960] AC 167—a man sold a truck to another man, but retained the
registration of the truck in his name. Later, after a dispute between the parties,
the seller of the truck seized it and took it to his premises. The Privy Council
held that the purchaser of the truck was the owner of it, and able to claim it back
from the seller who had seized it, and in whose name it was still registered, and
on whose premises it was placed.
 Aluminium Industrie Vaassen BV v Romalpa Aluminium [1976] 1 WLR 676—a
Belgian company, which manufactured aluminium foil, sold a quantity of the foil
to an English company, but stipulated in the conditions of sale that the Belgian
company would remain owner of the foil until payment had been received for the
foil. The foil was transported to the premises of the English company and held
there until the company went into liquidation. The court held that the foil was
owned by the Belgian company and did not pass to the liquidator as assets of the
English company for distribution to its creditors.
 Bird v Registrar of Titles [1980/81] SILR 47—a European planter in Solomon
Islands bought a freehold island, and after his death intestate it was sold by the
administrator of his estate to two Europeans who gave it to their respective
daughters. A Solomon Islands woman, who was married in custom to the
European planter, claimed that the planter had promised the island to her and her
family, and that she and her family frequently came to the island to gather
coconuts and firewood. The High Court held that, despite the frequent visits
to the island by the Solomon Islands woman and her family, the daughters of the
purchasers of the island were the owners of the island, and so they could remove
the Solomon Islanders from the island.
 Golay v North End Property Development (1980) 35 FLR 89—a company
which in 1987 purchased some four acres of freehold land in Suva, Fiji, from the
executor of the original owner discovered that a woman and her family were
living on part of the land and claimed to have been living there since the 1950's,
and refused to move. The Court of Appeal held that the company was the owner
of the land, and that the woman and her family must move out, despite their
lengthy occupation of part of the land.

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 Fiso v Reid CA 8/95—a man living in American Samoa inherited land in Samoa
from his father, but a distant relative and family had, for over 50 years, been
living on that land with the permission of the previous owner, and this
permission was continued, provided that the occupiers did not build a permanent
structure on the land. The occupiers, however, did build a permanent structure on
the land, and the owner brought proceedings for the removal of the relative and
family. The Supreme Court held that the man in American Samoa was the owner,
and, despite the lengthy occupation by the relative and family, was entitled to
order them out when they erected a permanent structure.

2.3.3 Common law rights and interests can be vested or

contingent
Under English and American common law, rights and interests in property may be
vested or contingent. But if they are neither vested or contingent, they cannot be
recognized by the common law.

2.3.3.1 Vested rights and interests in property

English and American common law begin with the notion of rights and interests
which are vested. The word “vest” is derived from the Latin word vestis, meaning
clothing. So rights and interests which are vested are those which, metaphorically
speaking, have been put on a person like his or her clothes. Everything has been done
or has happened that is required by law to confer the right or interest in property on
the person.
Thus Father Abraham may hand over his boat to his eldest son, Isaac, saying: “Here
this boat is yours now. I can no longer use it.” At that moment the right of ownership
of the boat is vested in interest in Isaac. If, on the other hand, the law required that
transfers of ownership of boats must be registered before ownership could be
transferred, not everything has been done to vest the ownership of the boat in Isaac,
and so no right to ownership is vested in Isaac.
There are two forms of vesting recognised by common law and equity—vesting in
interest and vesting in possession.
i. Vested in interest: Rights and interests in property are vested in interest when
all has been done to enable a person to acquire the right of ownership of the
property. If the property belongs to someone else, then everything has been
done which the law requires to transfer the right of ownership of that property
to the new owner, or, if a person has created a new form of property that has
not been owned before, that all has been done to create that property.. Then the
rights and interests are said to be vested in interest. Thus in the above example,
when Father Abraham handed over his boat to his eldest son, Isaac, saying:
“Here this boat is yours now. I can no longer use it” at that moment the right of
ownership is vested in interest in Isaac.
ii. Vested in possession: The actual enjoyment of rights and interests in property
may occur as soon as they are acquired, ie vested in interest, or enjoyment of
those rights may be postponed to a later date. At the time when the rights and
interests in property can be exercised or enjoyed, they are said to be vested in
possession. Thus in the imaginary example above, rights to ownership of the
boat are vested in interest and also vested in possession in Isaac at the same
time when Father Abraham hands over the boat to Isaac with the words: “Here
this boat is yours now. I can no longer use it.”

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But it would be different if Father Abraham had said: “Here this boat is yours
now. I can no longer use it. But I want to make a last sail in it tomorrow. I will
keep it until I have had my last sail.” In this example, Isaac is vested in interest
with ownership of the boat, but he cannot exercise or enjoy that right until
Father Abraham returns with it tomorrow. In this example, the rights of
ownership in the boat are vested in Isaac in interest today, but are not vested in
him in possession until tomorrow.

2.3.3.1.1 Vesting of future rights to property — reversions, remainders

The English and American common law recognized, what Roman law was unable to
recognise, that people can have vested rights to property, in the future, at least real
property or land. There were two main forms of future interests in land that could be
vested in interest, though not in possession:
i. reversions, ie the right to ownership of land which will return or revert to the
original owner after a prior right to that land vested in another person has
expired; and
ii. remainders, ie the right to ownership of land which will transfer to another
person, often called a remainderman, a prior right to that land which is vested
in another person, has expired.
These were rights to own land which were regarded as vesting in interest as soon as
they were granted, because everything had been done which the law required for the
right to ownership to vest, even although the right to possession was postponed until
the expiry of the prior interest. But that prior interest will inevitably expire, and so the
future right is regarded as vested in interest, even although it will not be vested in
possession until the prior right expires. Thus if a landowner granted the land to
another man for life, the landowner was considered to be vested with the right to
ownership in reversion; and if a landowner granted land to his elder son for life and
then to the younger son for life; and then to the eldest son of the elder son in fee
simple, ie indefinitlely, the elder son would be considered to have a right to
ownership of the land vested in interest and in possession, while the younger son
would be considered to have a right to ownership which is vested in interest in
remainder, and so also the eldest son of the elder son.
Logically these rights in reversion and in remainder could have been considered not
as vested rights but as contingent rights, because they were dependent on the expiry
of the earlier right to ownership. But the courts of common law in England and
America did not look at them that way. Instead they held that the expiration of the
prior rights can be regarded as events which are inevitable, which must happen, and
therefore are not true contingencies or possibilities which may or may not happen.
These concepts of vested interests in reversion and remainder were developed
particularly with regard to freehold land, and there is some uncertainty as to whether
they are equally applicable to personal property—there will be a more complete
discussion in the next Topic.
Contingent or conditional reversions or remainders English and American common
law courts were prepared to recognise not only reversions and remainders which were
vested, but also reversions and remainders which were contingent or conditional upon
the occurrence of some natural event or upon the taking of some action by some
person — other than the expiry of a prior right to the property— before they can be
acquired. A very commonly accepted condition precedent for remainders was that the
remainderman must be aged 21 years or more.

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As mentioned earlier, because of the view taken by the courts that the expiry of a
previous right to ownership is not to be regarded as a contingency because it will
inevitably happen (see above), rights to ownership in reversion and in remainder,
without a condition, are not regarded as conditional or contingent rights, but are
regarded as vested.

2.3.3.2 Contingent or conditional rights and interests

English and American common law have accepted that rights and interests in property
may be recognized even although they are not vested, if they are contingent or
conditional, ie they will become vested upon the fulfillment of a condition or
contingency.
In order to be contingent, all must have been done to render the right or interest
vested, except the fulfillment of some condition which has been stipulated by law or
by the transferor. . If the condition is fulfilled then the right or interest will be
automatically vested in interest at least, but if the condition is not fulfilled, the right
or interest will not be vested.
Thus, in the imaginary example that we have been considering, if Father Abraham
said to his son Isaac: “Here is my boat. I can no longer use it. It is yours, if you tell
me you want it.” Here the right to ownership does not arise, does not vest, until Isaac
has said that he wants to have the boat - the right of ownership is conditional or
contingent upon Isaac signifying that he wants it. If Isaac does not tell Father
Abraham that he wants the boat, the right to ownership of the boat remains vested in
Father Abraham.
Such a condition is called a condition precedent, because it must be fulfilled before
rights and interests can vest, and it is only when, and if, the condition precedent is
fulfilled, that the right or interest can vest. If a condition precedent is not fulfilled, the
right does not become vested, but disappears, or, as is said in a legal context, it lapses.
Conditions precedent may be express or implied Conditions relating to the vesting
of property may be expressly stated in writing or orally, or they may be implied from
words and/or conduct. Thus Father Abraham may say: “This is my boat. You may
have it so long as you use promise to use it only for fishing.” Here the condition is
expressly stated that Isaac must promise that the boat is to be used only for fishing.
Father Abraham may say: “Here is my boat. You may have it if you promise to use it
for fishing.” Here it may be argued that it is to be implied that Isaac must promise
that the boat is to be used only for fishing, but it is not expressly stated.
Conditions precedent may be expressed in positive or negative terms A condition
precedent may be expressed in positive terms, and so act as a form of qualification
necessary to acquire or to retain a right or interest in property. Thus Father Abraham
may say: ”This is my boat. It is yours, if you promise to use it for fishing.”
Alternatively, a condition precedent may be expressed in negative terms, and so act as
a disqualification from acquiring or retaining a right or interest in property. Thus
Father Abraham may say: “This is my boat. It is yours, provided that you have not
been going out with Naomi these last months.” A condition precedent, therefore, may
operate as a qualification to, or a disqualification from, a right to property.
Two examples from the law reports of the operation of conditions precedent are:

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Re Lowry [1967] 1 Ch 638—a testator in his will gave a fund of money to

be divided amongst 13 named charities unless any such charity “shall have
ceased to exist as an independent charity”. The High Court held that because
the management of three of the charities had been taken over by the National
Health Service operated by the British government, no right to a share of the
funds vested in those three charities because they did not fulfil the precedent
condition of being independent - they were disqualified from acquiring a right
to the property...
Re Wolffe [1963] 1 WLR 1211—a testatrix in her will gave a sum of money to
a granddaughter of the testatrix on the marriage of the granddaughter to “a
person of the Jewish faith and the son of parents of the Jewish faith”. The
granddaughter married a man who was neither of Jewish faith nor the son of
parents of Jewish faith. As a result, the High Court held that the
granddaughter was not entitled to the legacy - she did not qualify to obtain a
right to the property..
Conclusion Rights and interests which are subject to a condition precedent
before they become vested are obviously not as strong or as valuable as rights and
interests which are vested, because they may in fact never become vested in interest
or possession, because the condition precedent may never be fulfilled. But the
common law nevertheless considered that they were of sufficient value to recognise
them as legal rights and interests, because they will vest in interest and possession, if
the conditions upon which they are dependent are fulfilled.

2.3.3 No vested or contingent right or interest - spes or mere

expectation or hope
There are basically two situations where English and American common law were not
prepared to recognise rights and interests in property.
2..3.3,1 Not everything has been done to create a vested or contingent right or
interest in property
English and American common law were prepared to recognise rights and interests
in property where all had been done as required by law to acquire that right or
interest, ie vested rights and interests, and also where all had been done as required
by law to acquire a right or interest, but it was subject to a condition which had to be
fulfilled before it would vest the right or interest, ie conditional rights and interests.
But English and American common law have not been prepared to recognize as rights
or interests in property, expectations or hopes to acquire property where not all has
been done as required by law for a person to acquire a right or interest in the
property. A mere expectation or hope that a right or interest will be acquired is not
enough to constitute a right or interest in property under the common law.
Thus if Abraham were to say to his son, Isaac: “Isaac, my son, this is my boat. One
day I will give it to you and it will be yours.” Here there is no gift of the boat to
Isaac. There has been a unilateral promise by Abraham, not a contract, and Isaac can
only hope that one day the boat will be his.
A classical example of a situation where there was a hope, a well justified hope, that
property would be transferred to a person, but it never was, and so the person was
unable to successfully claim ownership of it is the following case:

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Milroy v Lord [1861 - 73] All ER Rep 783 A wealthy man in America,
Thomas Medley, executed a deed giving 50 shares owned by him in the Bank
of Louisiana .to a trustee to hold for his niece in England, Mrs Milroy, and in
the event of his death to transfer the shares to the niece. He also gave the
trustee a power of attorney to deal with his shares. The trustee never lodged
with the bank the power of attorney authorizing him to deal with the shares
owned by Medley, as required by the bank’s constitution, nor did he or
Medley transfer the shares of the bank from the name of Medley to the name
of Mrs Milroy. After Medley’s death, Mrs Milroy requested that the trustee
hand over the shares to her but he refused, and she brought proceedings to
compel him
The Court of Appeal held that the requirements of the law with regard to the
transfer of the shares to Mrs Milroy had not been complied with, so there
there had been no gift of the shares to Mrs Milroy at common law. As we will
see later, the courts of equity will also not intervene, because they have made
it a rule that “there is no equity in this court to protect an imperfect gift.”
If a right or interest to property is not able to be established under the common law,
there is a possibility that a person may be able to rely upon some circumstances,
which under the principles of equity would be regarded as providing a basis of a
claim to an equitable interest in the property. This issue will be considered more fully
in a later section of this Topic.
2.3.3.2 Destruction or disappearance of property If the property in which a
person had rights or interests is completely destroyed, as by fire, or by explosion,
then clearly the rights and interests which that person had in the property have been
destroyed also. In effect, the same will occur if the property disappears, either
through loss or stealing, but if it re-appears, then the rights and interests will be able
to be re-asserted.

2.3.4. Divesting or forfeiture of rights and interests in property

English and American common law have also recognized that a right to ownership of
property may also be subject to a condition subsequent, that is, it will come to an end,
or terminate, or be divested, if the condition is fulfilled, or is not fulfilled, depending
upon whether the condition is expressed in positive or in negative terms. Such a
condition was often described in earlier times as a forfeiture or a defeasance. Thus in
the example above, Father Abraham may say: “Here is my boat. You can have it, but
you must look after it, and if you drive it over 20 knots, it comes back to me.” This is
an example of a positive condition subsequent. Alternatively, Father Abraham may
say: “Here is my boat. You can have it and use it for fishing, and if you do not use it
for fishing, it comes back to me.”
Conditions subsequent may be express or implied Conditions relating to the
divesting of property may be expressly stated in writing or orally, or they may be
implied from words and/or conduct. Thus Father Abraham may say: “This is my boat.
You may have it so long as you use it only for fishing.” Here the condition is
expressly stated that it is to be used only for fishing. Father Abraham may say: “Here
is my boat. You may have it for fishing.” Here it may be argued that it is to be implied
that the boat is to be used only for fishing, but it is not expressly stated.
Conditions subsequent may be expressed in positive or negative terms A condition
subsequent may be expressed in positive terms, and so act as a form of qualification
necessary to acquire or to retain a right or interest in property. Thus Father Abraham

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may say: ”This is my boat. You can have until you are 21.” Or Father Abraham may
say: “This is my boat. You can have it so long as you remain single.”
Alternatively, a condition subsequent may be expressed in negative terms, and so act
as a disqualification from acquiring or retaining a right or interest in property. Thus
Father Abraham may say: “This is my boat. I am giving it to you. You will have it
when you are 21 unless you are married” Or Father Abraham may say: “This is my
boat. You will have it as long as you do not marry.”
Examples of the operation of a condition subsequent or a defeasance clause are to be
seen in the following cases:
Bromley v Tryon [1952] AC 265. A testatrix devised a large estate of
freehold land to relatives who also were related to the owner of another large
estate, so she provided that if the devisees became entitled to the other large
estate or the bulk thereof they would lose their interest in the property that she
was devising. The House of Lords held that it was clear that one of the
relatives was entitled to the other large estate, and so lost his interest to the
estate devised by the testatrix.
Re Gape [1952] Ch 743. Aa testatrix devised her property to relatives and
stated that they “shall within six months from the date of becoming entitled
take up permanent residence in England”, and in default the property would
go to others. Two of the relatives lived in USA, and the High Court held that
these two would lose their rights to the property if they did not take up
permanent residence in England within six months.

Exception—Conditions subsequent to personal property without gift over to another

person
The civil law, which as mentioned earlier was followed by English courts with regard
to personal property, developed the notion that some conditions subsequent relating to
personal property were not intended to be effective unless provision was made for the
rights or interests which had been determined or forfeited to be vested in some other
person, what is technically called a gift over. In the absence of a gift over re-vesting
of the rights or interests which were determined, the forfeiture clause was construed
as being not mandatory and merely to frighten, or, as it was sometimes said, in
terrorem, ie a Latin phrase meaning to produce fright, but not to actually act as a
defeasance and remove rights and interests that were vested.
So, it is always possible to argue, with regard to personal property, that defeasance
clauses that are not supported by a gift over vesting the forfeited rights or interests in
some other person, are merely in terrorem, and can be disregarded. This principle has
also been applied to the forfeiture of rights to real property as in the following case:
Re Brace [1954] 1 WLR 955—a father devised his house too his daughter
Irene “on condition that she will always provide a home for my daughter
Doris [who was mentally handicapped].” There was no gift over of the house
to anyone else, and one of the grounds upon which the High Court held that
the condition subsequent was not binding upon Irene was that it was a merely
in terrorem instruction to Irene.
Conclusion Rights and interests in property which are subject to a condition
subsequent, or a defeasance, are obviously not as strong as those rights and interests
which are free of any condition subsequent, which are absolute, because they may be
terminated sooner than those which are absolute. But the common law nevertheless

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considered that they were of sufficient value to recognise them as legal rights and
interests, because the condition subsequent might never be activated to terminate
them.

2.4 Equitable interests

Equitable interests in property derive from the principles of equity which have been
introduced into the legal system of all countries in the USP region. The main features
of equitable rights and interests in property are:
2.4.1. C l a i m s t o e q u i t a b l e i n t e r e s t s i n p r o p e r t y c a n b e j u s t i f i e d
or supported by some conduct on the part of the common law
owner of the property or some third party which is
unconscionable
Equitable interests in property arise as a consequence of some conduct by the
common law owner or some other person which, in the view of the court, is
unconscionable or contrary to good conscience in relation to that property, and so
provides a basis for a claim in relation to that property. That claim may be a claim to
ownership or possession of the property, or to the income from the property, or to the
proceeds from the sale of the property, according to the circumstances of the
particular case. The main bases of claims for interests in property under principles of
equity are:
Contract.
The courts of equity have held that if parties make a contract which is binding under
the common law, they will provide remedies if the terms of that contract are not
carried out by one of the parties. Such conduct is regarded as unconscionable and the
courts of equity may grant a decree of specific performance to compel the recalcitrant
party to carry out the terms of the contract. Where the contract provides for the
granting of a right or interest in property, and a party has acted on the basis of that
contract, it is unconscionable for the other party to deny the contract. Thus where an
owner of land has contracted to grant a lease of that land, and the other party acts on
that contract and occupies the property, the occupier can claim an equitable interest
in the property:
Walsh v Lonsdale (1882) 21 Ch D 9 An owner of land made a contract to
grant a lease to another man. The other man occupied the property but no
lease was granted by the owner. The occupier declined to pay rent in
accordance with the agreement. The court held that the owner could sue for
the rent as provided in the agreement.
Shodroske v Hadley (1908) 10 GLR 333 A land owner made an agreement
with several persons for them to lease the property. They occupied the
property but no lease was granted. The land owner re-entered claiming that
they were acting in breach of the terms of the agreement. The court held that
the occupiers were entitled to seek relief against forfeiture, even although no
lease had been granted.
Rewiri v Eivers [1917] NZLR 479 Eivers occupied some land in New
Zealand under a lease which had not been registered as required by the Land
Transfer Act of New Zealand. A fire lit on neighbouring land spread on to the
land occupied by Eivers, and the court held that Eivers had sufficient
equitable interest in the land to claim damages for the loss caused on the land
by the fire.

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For more recent examples see: Tottenham Hotspur Football Club v Princegrove
Publishers [1974] 1 WLR 113; Industrial Properties Ltd v Associated Electrical
Industries [1977] QB 580. .
Trust
Three kinds of trust have been recognized by the courts.
Express trust An express trust is said to occur when a person agrees to hold
property owned by him or her o for the benefit of some other person. The property
may be transferred by some other person (usually called the trustor) to the person
who agrees to hold it on trust (usually called the trustee) for the benefit of some other
person (usually called the beneficiary), or the property may be owned by the trustee
and he states or declares that he holds that property for the benefit of some other
person. The beneficiary can bring a claim in equity against the trustee for breach of
trust if the trustee fails to hold the property for the benefit of the beneficiary, and this
is said to give the beneficiary an equitable interest in the property. It is important to
note that the courts of equity did not require that the agreement of the trustee to hold
the property on trust should be expressed in the form of a contract. It is sufficient if
the trustee accepts or acquiesces to do so. Below are some examples of an express
trust forming the basis for an equitable claim by the beneficiary:
Rochefoucauld v Boustead [1897] 1 Ch 196. A large coffee estate in Ceylon
owned by the Comtesse de la Rochefoucauld was sold at a public auction to
Boustead, who then operated it as his own, before he re-sold it to another
purchaser. Later the Comtesse claimed that Boustead had agreed to hold this
estate in trust for her, and brought proceedings to recover the earnings that he
had received from the estate before it was resold.
The Court of Appeal upheld the Comtesse’s claim that Boustead bought the
coffee estate as trustee for her, and ruled that he must account to the Comtesse
for the profits which he had made from the estate..
Mountain v Styak [1922] NZLR 131. A mother made a declaration that she
held land in trust for her son and daughter, but when she died she devised the
land to her daughter only, and the daughter tied to exclude her brother. The
Court ruled that the daughter held the land as trustee for herself and her
brother equally.
Implied trust Even when there is no express statement by a person that he or she
holds property for the benefit of some other person, the courts have held that such
intention may be implied if the circumstances and the conduct of the parties so
indicates. An implied trust is considered by the courts to arise when the parties may
be presumed or inferred to have the intention that property shall be held in trust even
although no express words have been stated. Such intention is presumed particularly
when one party has contributed significantly to the acquisition or the maintenance of
the property in question, either directly or indirectly, as in the following cases: .
Maharaj v Chand [1986] 1 AC 898 A man and a woman lived together in a
house, during a de facto relationship. The man paid for the house, and the
woman used her earnings to support the family When the man left, the Privy
Council held that the woman was entitled to continue to occupy the house
indefinitely, by virtue of the financial contributions which she had made to
support the family, thus enabling the man tio use all his money to pay for the
house.

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Nisha v Munif (1999) 45 FLR 246 A mother and son shared a house which
was registered in the name of the son. The mother made financial
contributions to the purchase price, to mortgage repayments, and to
furnishings for the house. Later, after disagreements with her son, the mother
moved out of the house and she claimed a half share of the house, claiming
that she believed all along that she was a co-owner. The Court held that she
had sufficient equitable interest in the house by virtue of the contributions that
she had made and held that under an implied trust she was entitled to half
share of the house, and it ordered the son either to allow the mother to live on
in the house so long as she wished, or else transfer to her a one half interest in
the house..
Prasad v Devi [2000] 1 FLR 34 A husband and wife lived in a house which
was registered in the name of the wife although the husband paid the deposit,
and many of the installment payments. The wife then left and they were
divorced. The husband sought an order that the register be amended to show
both parties as joint owners of the house. The Court granted the order by
virtue of the payments made by the husband on the basis of an implied trust.
Constructive trust The courts have also developed the notion of a constructive
trust, which does not necessarily depend on the intentions of the parties, but is
imposed by the courts when they consider that a person’s conscience should be
affected with regard to a property. This is particularly so, if a person receives property
which he knows, or should know, has been dealt with in breach of trust, or if he
assists a trustee to deal with property in a way which he knows, or should have
known, was in breach of the trust..
Barnes v Addy (1874) 9 Ch App 244 A surviving trustee of a trust fund which
was for the benefit of his children and the children of another man transferred
half of the fund to the other man to hold as trustee for his children. In fact the
man wasted the money and his children received nothing. The children then
claimed against the solicitors who drew up the documents for the transaction.
The Court of Appeal dismissed the claim, holding that the solicitors had
advised against the transaction, but had been instructed to proceed, and they
should not be made constructive trustees “unless these agents receive and
become chargeable with some part of the trust property, or unless they assist
with knowledge in a dishonest and fraudulent design on the part of the
trustees.”
Powell v Thompson [1991] 1 NZLR 597 A mother and her two daughters
were co-owners as tenants in common of a house. The mother, who worked in
an accountant’s office, over a period of years, embezzled some $289,000
from a client of her employer, and when he discovered the theft, he demanded
that she repay the amount she had stolen. She did so by selling the house to
her employer’s client, without the knowledge or consent of her daughters, and
in reliance upon an old power of attorney which they had given her years
before. The client was aware that the daughters had a share in the house, and
asked his solicitor to make sure that the transaction was legal.
The court held that the purchaser of the property held it subject to a
constructive trust in favour of the two daughters to the value of their two
thirds share in the property, by virtue of the fact that he knew or ought to have
known that the sale of the property to him was in breach of the implied trust.

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Estoppel
The courts of equity have held that if an owner of property makes a representation, ie
a statement, to another person, that the representor will grant a right or interest in that
property to that other person, and that other person ie the representee, acts to his
detriment on the basis of that representation, the representor will not be allowed to
withdraw or resile from his statement. In legal terms, it is said that the representor is
estopped from withdrawing from the statement that has been made and acted upon by
the representee to his detriment..
Two elements are necessary to create a binding proprietary estoppel: a representation
by the property owner that an interest in property will be granted; and action by the
representee on the basis of that representation which is to his detriment or
disadvantage. The representation may be express, in the express words of the parties,
or it may be implied from the conduct of the parties and the surrounding
circumstances.
The following cases illustrate the way in which proprietary estoppel can provide the
basis for an equitable claim against the owner of the property, and provide the
representee with an equitable interest in that property:
Dillwyn v Llewellyn (1862) 45 ER 1285 A father said to his eldest son that he
wanted the son to live near him, and told the son that if he built his house on
part of the father’s land near the father’s house, the father would transfer the
land to him. The son built his house on the land designated by the father, but
the father did not transfer the land to the son before he died. The court held
that the father’s personal representative could not withdraw from the promise
made by the father and acted upon by the son.
Plimmer v Wellington City Corporation (1884) NZPCC 250. Plimmer, a
merchant in Wellington, New Zealand, built a jetty on the foreshore of
Wellington harbour. The foreshore was owned by the Crown which made no
objection to the jetty, which was in fact used by the colonial government for
disembarking immigrants. The Privy Council held that the government, by
its acquiescence in the construction of the jetty, and its use of the jetty, had
impliedly represented to Plimmer that he had permission to use the land as a
jetty indefinitely.
More recent examples of proprietary estoppel can be seen in: Siew Soon Wah v Yong
Tong Hong [1973] AC 837; Inwards v Baker [1965] 2 QB 29; Crabb v Arun District
Council [1976] 1 Ch 179; Lawlor v Duaibe (1976) 22 FLR 134; and Australasian
Conference Association v Mere Sela {2007} FJHC 169.

2.4.2 Equity will not complete an incomplete gift

The courts of equity have held that they will not intervene to recognise any rights or
interests, arising out of a transaction of gift which is legally incomplete. This is
sometimes expressed by saying that equity will not intervene to complete an
imperfect gift. The following are examples:
Milroy v Lord [1861 - 73] All ER Rep 783 A wealthy man in America,
Thomas Medley, executed a deed giving 50 shares owned by him in the Bank
of Louisiana .to a trustee to hold for his niece in England, Mrs Milroy, and in
the event of his death to transfer the shares to the niece. He also gave the
trustee a power of attorney to deal with his shares. The trustee never lodged
with the bank the power of attorney authorizing him to deal with the shares

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owned by Medley, as required by the bank’s constitution, nor did he transfer

the shares of the bank from the name of Medley to the name of Mrs Milroy.
After Medley’s death, Mrs Milroy requested that the trustee hand over the
shares to her but he refused, and she brought proceedings to compel him
The Court of Appeal held that there had been no gift of the shares to Mrs
Milroy, and stated that “there is no equity in this court to protect an
imperfect gift.”
Re Fry [1946] 1 Ch 312 A man in England signed a transfer form to transfer
some shares owned by him in a company to his son. The form was approved
by the company for the transfer of shares, but under the law at the time the
transferor of shares was required to obtain the approval of Treasury to a
transfer of shares. Before the man could obtain that approval, he died.
The court held that the purported transfer of shares to the son was
incomplete and ineffective.
Subsequent courts have made it clear, however, that what is meant by an imperfect or
incomplete gift, is a transaction where the donor has not done all that is required of
him by the law, not that all has been done that is required by the donee. If the donor
has done all that he is required by the law to do to effect a transfer, that is sufficient to
render the gift complete or perfect, even if something more remains to be done by
others. The following case illustrates this :
Re Rose [1952] 1 Ch 499 On 30 March 1943, a man signed and sealed a
document transferring some shares owned by him in a company to his wife.
The document was in the form required by the company for the transfer of its
shares, and was handed, together with the share certificates, to the secretary of
the company for him to submit to the company for registration. The transfer
was registered by the company on 30 June 1947.
The Court of Appeal held that the gift was completed on 30 March 1943,
because at that date the man had done all that the law required of him to
transfer the shares.

2.4.3. Equitable claims in relation to property are

enforceable only against persons who acquire the property
with notice or as volunteers.

Equitable rights and interests are not enforceable against everyone, as are common
law rights and interests. They are enforceable only against persons who had notice of
them, when they acquired the property to which they relate, or who obtained that
property as a volunteer, ie without payment, as a gift, as in the following cases:
Trinidad Asphalt Company v Coryat [1896] AC 587 The owner of some land
in Trinidad contracted to sell it to a woman who paid the purchase price and
entered into possession, but the owner never made a formal transfer or
conveyance of the land to her. The woman later transferred her interest in the
land to a man who sold it to the asphalt company. Several years later, the
personal representative of the original owner sold the land to Coryat, who had
notice of the prior equitable claims of the company to the land. The Privy
Council held that Coryat must transfer the land to the company.
Re Diplock [1948] 1 Ch 466 A very wealthy man in England made
bequeathed his residuary estate to charitable institutions but this bequest was

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held to be invalid by the House of Lords. Before the bequest was challenged
in the courts the executor had already paid out bequests to a number of
charitable institutions. After the decision of the House of Lords, the next of
kin claimed to recover the money paid out as bequests to the charitable
institutions. The Court of Appeal held that where the money could be clearly
identified in the accounts of the institutions it was to be paid back to the next
of kin, where the bequest money was mixed innocently by the volunteer
beneficiary, the mixed fund was to be shared between the beneficiary and the
next of kin pari passu in proportion to the respective contributions, but where
the bequest money had been transferred for value without notice, it could not
be recovered by the next of kin.
Foskett v McKeown [2001] 1 AC 102 . An Englishman established a trust for
the development of land in Portugal as holiday homes. About 2,600,000
pounds was contributed by many different contributors to the scheme, but
the development was never carried out. . The man, in breach of the trust, used
some of the contributions to pay the premiums on an insurance policy on his
own life. In 1989 the man transferred his interest in the policy to a trust for his
children, and two years later, the man committed suicide. The contributors to
his failed scheme claimed against the children for the amount of their
contributions. The House of Lords held that the money acquired by the
children as volunteers was subject to the prior equitable claims of the
contributors under the trust scheme established by their father.
People who did not have notice of equitable rights and interests in property when
they purchased that property, and did not acquire it as a volunteer, ie as a gift, but are
bona fide purchasers for value of the property without notice are not bound by the
equitable rights and interests as in the following cases:
Pilcher v Rawlins (1872) LR 7 Ch 259 Jeremiah Pilcher gave L8000 to
trustees to hold on trust for himself and his children of his first marriage.
The trustees lent the trust money to Rawlins, a fraudulent solicitor, and he
transferred some of his land to the surviving trustee as a security for the loan.
Later, the surviving trustee wrongfully transferred this land back to Rawlins,
on repayment of part only of the loan. Rawlins then transferred this same
land to Stockwell and Lamb as a security for a loan of L10,000 by them to
him. They had no notice of the prior equitable interests of the beneficiaries of
the trust in that land. The court held that Stockwell and Lamb were the owners
of the land, free of any trust in favour of Pilcher and his children.
Jeremiah Pilcher also gave L3000 to a trustee to hold on trust for himself, his
second wife and the children of his second marriage. The trustee loaned all
this money to Rawlins, and Rawlins transferred some land to the trustee as
security for the loan. Rawlins then purported to transfer the land back to the
trustee, on repayment of the loan, but in fact no money changed hands. The
trustee then transferred it to Ward as security for a loan of L3000 made to him
by Ward to Rawlins. Ward had no notice of the trust. The court held that
Ward was the owner of the land, free of any trust in favour of Plcher, his
second wife and their children.
Bailey v Barnes [1891] 1 Ch 25 In August 1890, a man purchased some land
in England. Unbeknown to him, that land was subject to an equitable charge
in favour of some creditors of an earlier owner of the land. The Court of
Appeal held that because the man did not have actual or constructive notice of

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the equitable charge over the land, the land that he bought was free of the
charge.
2.4 .3.1 What notice will support a claim in equity?
Over the years, the courts of equity have developed three different categories of
notice which are sufficient to support a claim to an equitable interest in property:
actual notice, which is actual personal knowledge or awareness that a person
has, and applies to things that are actually personally known to a person;
constructive notice, which is notice which a person would have if he or she
took reasonable care in the dealing, and applies to things which a person should
know;
imputed notice, which is notice that is imputed to a person from the actual or
constructive notice of someone who is acting on behalf of that person, such as an
accountant, a land agent, or a solicitor, unless that person is acting fraudulently
against his principal.

2.4.4. Equitable remedies operate in personam and are

discretionary
Remedies provided by the courts of equity are always directed to a person, the person
whose conduct has been unconscionable, and they do not attach to the property itself
as do the remedies of the courts of common law. That is why equitable claims are
regarded as giving rise, at the most, to an interest, not a right, to property.
Furthermore, the remedies that a court of equity can provide are discretionary and can
be fashioned according to what is most appropriate in the circumstances of a
particular case. Thus in Maharaj v Chand (above) the court made an order allowing
the claimant woman to occupy the house indefinitely; in Nisha v Munif (above) the
court made an order that the son must either allow the mother to live in the house for
as long as she wishes, or transfer one half share interest to her; in Prasad v Devi
(above) the court made an order that the register be rectified to show the husband as
a joint owner along with the wife had left and gone overseas to live; in
Rochefoucauld v Boustead (above) the court made an order that Boustead must
account to the comtesse for all the profits from the coffee estate during the time that
the court ruled that he held it as trustee for her.; in Powell v Thompson (above) the
court held that the purchaser of the property must hold it on trust to the extent of the
value of the daughters’ claim.

2.5 Customary rights and interests in property

Customary rights and interests are provided by the rules of custom. They are subject
to the provisions of the written law, ie the Constitution, legislation and subsidiary
legislation. In all countries of the USP region, custom or customary law is recognized
as the basis for determining ownership of customary land.
In some countries of the USP region, ie Kiribati, Nauru and Tuvalu, customary law is
recognized by legislation as applicable to certain matters specified by the legislation,
other than ownership of customary land. In Samoa, Solomon Islands and Vanuatu,
customary law is recognized in general terms as part of the legal system, but the
matters to which it is to apply are not specified by the legislation, and the courts have
done little to make clear what matters, other than customary land, are to be regulated
by custom In Cook Islands, Niue and Fiji, customary rights and interests in land are

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confirmed by legislation, but the legal system does not appear to provide for
customary rights and interests to operate with regard to other matters.
Rights and interests recognized by customary law, are, like rights and interests
recognized by common law and equity, subject to the written law; ie the Constitution,
legislation and subsidiary legislation, as demonstrated in the following case:
Ao v Leota [1970 - 79] WSLR 202 A Samoan man purchased a lot of freehold
land in Samoa, and registered the deed of transfer to himself under the Land
Registration Act 1992/93. Previously the elder brother of the man, and some
family of the elder brother, had been living on the land, but after the man
purchased the land, he ordered them to leave the land. They refused, relying
upon custom, but the Supreme Court held that once the man was registered as
the owner of the freehold land under the Land Registration Act he had legal
right to exclusive ownership and possession of the land, and could order them
to leave.
The result is that custom and customary law has little impact in countries of the USP
region generally upon rights to property other than customary land, and so will not be
discussed further in this Course, and any further discussion will be deferred until LW
322 Customary Law.

3. Rights and interests in property rendered

unenforceable by the law
The written law and the unwritten law may sometimes provide that rights and
interests in property which would normally be recognized by the courts, must not, in
some circumstances, be recognized. The two main circumstances in which rights and
interests in property will not be recognized by the courts are:

3.1 Acquisition by illegal means

The rules of common law and equity provide that if a claimant has to rely upon some
illegal transaction to base his or her claim to a right or interest in property, then the
courts will not recognise it:

Chettiar v Chettiar [1962] AC 294 - a man who owned a rubber plantation in

Malaya, in order to avoid regulations which prescribed the maximum area of
rubber plantations, transferred 40 acres of his land to his son for a price that
was never paid. Later, the father wished to sell the 40 acres to another person,
but the son refused to sign the necessary documents. The father claimed that
the son was holding the land on trust for him, and that he was entitled to the
land. The Privy Council held that since the father, to support his claim that the
land was held on trust for him, had to disclose that the transfer to the son was
done in order to evade the regulations, could not have his claim enforced by
the court.

3.2 Limitation on time for bringing court proceedings to recover property

In most countries of the USP region, there are statutory provisions in Limitation
Acts which prohibit the commencement of proceedings to recover personal
property more than 6 years, or to recover land more than 12 years, or some other

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defined period, after the cause of action arose. The result of this legislation is
to prevent the enforcement of rights to property under the common law after the
period defined in the legislation:
Lee Bow Yiu v Patel (1957) 5 FLR 62. In 1916 the owners of freehold land in
Suva, Fiji, erected a building on land owned by them which extended onto
neighbouring land owned by another person without the permission of the . In
the 1950's the owners of the neighbouring land brought proceedings to have
the building removed from their land. The Court held that the cause of action
arose in 1916 when the building was first constructed on the neighbouring
land without permission of the owners of the land, and the time limitation
period had long expired, so the neighbour's rights to ownership of the land on
which the building had been erected could no longer be enforced.
Jennings v Onesemo [2000] WSSC 26 In 1995 the owner of freehold land
in Samoa brought court proceedings to remove some persons from his land
which they had been occupying since 1975, and upon which they had built a
house, not knowing that the land belonged to the owner. The court held that
the owner could not succeed because more than 12 years had elapsed since the
occupiers had occupied the land without permission.

4. Rights and interests in property rendered

unchallengeable by law
The written law may provide that rights and interests in property are unchallengeable
in the courts. The main situation where legislation has been enacted for this purpose
is with regard to rights and interests which have been officially registered or
recorded. :
4.1 Official registration of rights and interests in property In many countries
there are legislative provisions requiring that rights to real property must be registered
with a government registry, and, if they are registered, they are unchallengeable,
except on limited grounds, such as fraud by the person registering the land:

Koli v Bayly (1959) 4 FLR 139 The Land Transfer Act of Fiji
provides that the registered proprietor of an interest in land holds that
interest free of any challenge, except in the case of fraud. A man
registered a transfer to him of the freehold estate of the land. Some
time before, but unknown to the registered proprietor, a former owner
of the land had granted a lease over the land to another person The
person to whom the lease had been granted was held unable to
challenge the registered ownership of the land

Attorney-General v Kumar and Riley (1985) 31 FLR 2 The owner of

a half share of freehold property in Fiji sold it to another man. The
register compiled under the Land Transfer Act recorded, by mistake,
that the whole of the land had been sold to the man. The purchaser
then sold the whole block to a third person who had no knowledge of
the error made by the land registry, and registered the whole block in
his name. The court held that the ownership of the whole block by the

Topic 2: Introduction to property—Rights to property 2.24

 25

third person could not be challenged, and so the original of half the
block was unable to enforce his right to half the land.
It is important to note that the legislation that requires motor vehicles to be
registered does not usually affect rights of ownership:
Singh v Ali [1960] AC 167—a man sold a truck to another man, but
retained the registration of the truck in his name. Later, after a dispute
between the parties, the seller of the truck seized it and took it to his
premises. The Privy Council held that the purchaser of the truck was
the owner of it, and able to claim it back from the seller who had
seized it, and in whose name it was still registered, and on whose
premises it was placed.
.

SUMMARY
In summary, the various legal sources of rights and interests in property affect the
nature and effects of those rights and interests. Those that are most strong are those
that are contained in the Constitution, but only in Samoa, Tonga and Vanuatu, do the
Constitutions provide such rights and interests, in relation to land. .In Solomon
Islands and Tonga, legislation provides some important forms of rights in land. In all
countries of the region, the rules of common law provide some very important kinds
of rights and interests in property, and the rules of equity also operate in all countries
to provide some significant kinds of interests in property. Customary law provides
important rights to customary land in all countries of the USP region, except Tonga,
but its effect in respect of other property is not very significant.

KEY TERMS

Ownership
Possession
Constitutional rights and interests
Common law rights and interests
Legal rights and interests
Equitable interests
Vested in interest
Vested in possession
Reversions
Remainders
Condition precedent
Conditions subsequent

Topic 2: Introduction to property—Rights to property 2.25

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REVIEW QUESTIONS

1. What is the difference between ownership and possession?

2. What is the difference between reversion and remainder?
3. What is the difference between a positive condition precedent and a negative
condition precedent?
4. How are rights to property acquired?

Topic 2: Introduction to property—Rights to property 2.26

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Topic 2: Introduction to property—Rights to property 2.27